German Municipalities Face €32 Billion Hole as ver.di Mobilizes Against Federal Job Cuts
13.06.2026 - 10:42:54 | boerse-global.de
A bitter dispute over public spending is widening, with local authorities bearing the brunt of a deepening fiscal crisis. ver.di vice chair Christine Behle on Friday slammed the government’s proposed relief package for municipalities and states as woefully inadequate. The draft law, known as the Länder- und Kommunalentlastungsgesetz, would provide €1 billion annually over four years — a fraction of the €32 billion combined deficit that German towns and cities posted last year. Behle called for the reintroduction of a wealth tax to close the gap.
The criticism came as the trade union’s works council group submitted a petition to stop planned cuts of 8 percent of positions across federal ministries, beginning with the Family Ministry. The petition demands an immediate halt to the reductions and a long-term guarantee of funding for state tasks. ver.di chief Frank Werneke, after a meeting with coalition representatives at the chancellery, warned that the austerity push must not turn into a “social devastation” of welfare systems. While he described the talks as constructive, he insisted reforms cannot come at the expense of the most vulnerable.
The wider protest campaign is gaining momentum. An independent petition by the Lebenshilfe association against proposed cuts to integration assistance — services used by around one million people in Germany — had collected more than 180,000 signatures by Friday. Chairwoman Ulla Schmidt, addressing a hearing of the Bundestag petitions committee, called the savings plans an attack on the fundamental values of the welfare state.
Meanwhile, the coalition is pressing ahead with its own agenda. Chancellor Friedrich Merz, in a government statement on Thursday, defended the reform course and called for greater willingness to change. He wants key packages on the labor market, bureaucracy reduction and income tax to be completed by the summer break in mid-July. A decisive summit of coalition leaders is set for July 1.
Opposition parties from the Greens to the Left and the AfD accuse the government of either inaction or social injustice. The pressure is also mounting in the health sector. Health Minister Warken presented the so-called Beitragssatzstabilisierungsgesetz (contribution rate stabilisation act) in the Bundestag on Friday. Her ministry forecasts a deficit of €19 billion in statutory health insurance by 2027, rising to €44 billion by 2030. The bill envisages higher co-payments and cuts to contribution-free family insurance.
While Germany debates, Switzerland has already moved. The State Secretariat for Migration (SEM) announced on June 8 that it would cut 108 positions — a reduction of 6 percent, bringing total full-time posts to around 1,280. The move follows a decline in asylum applications. Earlier in 2026, the SEM had already eliminated 83 jobs. Dismissals for permanent staff are set to take effect at the start of 2027.
Back in Germany, tensions are spreading beyond the federal level. ver.di resumed negotiations at public-service broadcasters on Thursday, with further rounds scheduled for NDR and BR. The union has not ruled out strikes, arguing that the current offers fall short of recognised increases in personnel costs.
